Marui Group Co Ltd Ord

So now we are starting the financial results briefing for March 2025 for Marie Group. So you are able to download today's presentation on materials from our corporate site. So please look at the overview of performance. So today we will spend the first 30 minutes for explanation of the presentation and then take your questions. Since we are explaining the future direction forward more in details, so some of the results information of businesses are included in the appendix. Today, we have Director Senior Managing Executive Officer and CFO Kato to explain the financial results overview and forecast for March 2026. and followed by the Business Management Vision and Strategic Story 2031 will be explained by President and Representative Director Aoi. In addition to these two members, we will have IR Manager Udaka to be here to answer your questions. So this is what we covered today. First, I will pass the floor over to CFO Kato.

I am Kato. I will explain the outline of the financial performance for fiscal year ended March 25 and outlook of next fiscal year. There are three KPIs. EPS was 143.2 yen, 10% increase. ROE, 10.6%. surpassed 10.10% in 34 years. ROIC was 3.8%. Consolidated operating income increased 9% to 44.5 billion yen, short 500 million yen to the plan. Retailing profit increased by 1.6 billion yen, 100 million yen gap to the plan. Fintech increased profit by 1.7 billion, short of 400 million yen to the plan. Net income recovered to pre-COVID level and 26.6 billion yen increased by 8%. These are three KPIs, EPS 143.2 yen, ROE higher than 10%, ROIC and also surpassed WACC. Group total group transactions expanded steadily and reached new record. Operating profit 44.5 billion yen higher by 3.5 billion yen year-on-year. Net income 26.6 billion yen, 1.9 billion yen increase. Retailing plus 1.6 billion, fintech plus 1.8 billion, total company plus 200 million, the increase of profit by 3.5 billion. This is the retailing. This is the gap of the operating income. Retailing, tenant $1.7 billion, event $300 million increase, and Interior work and related business progressed well and retailing segment increased profit by 1.6 billion. This is tenant revenue. Next is fintech operating profit. Along with the expansion of the transaction, income increased, and we revisited the point program and suppressed the cost. Therefore, profit increased by $1.7 billion. From the previous forecast, the income reduced by 300 million due to reduction of the transaction, and we executed expense such as UX improvement. This is card credit transaction. The transaction value achieved record high amounted to ¥1,151.7 billion. This is the merchant commission rate. In the second half, the commission rate was 1.21% and has been stable. Installment and revolving commission, Year-on-year, trend was 110% and 59.6 billion yen of commission revenue, 8% increase. This is co-creation investment, 1.1 billion to start-up and 900 million to fund. Total of 2 billion was invested. and $3.1 billion contribution to the main business. IRR of startup companies was 10%, same as hurdle rate. This is non-operating and extraordinary. P&L operating profit increased by 9%, $3.5 billion increase year-on-year. Ordinary profit increased 3%, major factor. The increase of finance cost of 1.8 billion and interest rate rise impact was 1.6 billion. Extraordinary profit. There were sale of shareholding and idle. real estate, and all in all, versus last year, it was plus $4.9 billion. The net income increased by 8% to $26.6 billion. This is balance sheet and capital allocation. Balance sheet total asset, due to increase of the Operating accounts receivable, it reached 1,053.4 billion yen. Shareholders' equity ratio was 23.4%. Capital allocation, basic operating cash flow, 49.7 billion yen. and borrowing of $8.2 billion was allocated, and $57.9 billion was allocated to growth and shareholder return. $19.9 billion to growth, $18.5 billion to share buyback, and $19.5 billion to dividend. Next is the outlook for next year.

EPS is expected to increase 8% to 155 yen, ROE to 11.2%, and ROE to 3.9%, all of which are expected to exceed the previous year. We are aiming for the group's total transaction volume to exceed 5 trillion yen, operating profit to increase 12% to 50 billion, and net profit. to increase 5% to 28 billion yen. Ordinary profit forecast, while operating profit expected to increase by 5.5 billion yen, non-operating income and expenses will be down 3.3 billion yen from the previous year due to factors such as increased financial expenses caused by rising interest rate and ordinary profits to increase 5% to 42 billion yen. Operating profit by segment, retail is to increase 28% to 11 billion and fintech is to go up by 7% to 47 billion yen. Here's a breakdown of profit increase in the retail segment. We expect a profit increase of 2.4 billion yen mainly due to the expansion of tenant income and events. Fintech, we expect an increase in profits of 2.9 billion yen due to an increase in merchant fees and installment payment fees accompanying the expansion of transaction volume. The fiscal year ending March 2026 is going to be the final year of the current midterm plan. So let me recap on the current midterm plan. So the current midterm plan started back in March 22. So we tried to improve the corporate values by impacting capital policies and business strategies. The impact was actually including supporting each individual interest and also innovation of the working style in the organization. However, we weren't able to incorporate innovation in sustainable consumption and lifestyle. In capital policy, we completed optimization of shareholder equity and achieving our desired balance sheet. In order to improve capital efficiency and achieve long-term stable increase in dividend, we introduced a DOE in the fiscal year ended March 2024, and dividend doubled compared to March 23 in the net income. And this year, we had a dividend increase for 13 years in a row. Business strategies, basically everything, operating profit moved as planned. including measures for the retail, which does not sell. The fintech saw a delay in recovery from COVID, and we saw the slowness in adding new members. But we struggled in the new businesses while we made the investment in co-creative future investments. These are the major KPIs, the midterm plan. We failed to accomplish the three KPIs, the EPS, RE, ROIC. Operating profit, we fell short of the consolidated target level by 10 billion yen due to the minus 6 billion in fintech. And this is the progress of major three KPIs. So March 25, KPI result, which is in the fourth year midterm plan, we basically accomplished the third year plan one year behind. So as an extension of current midterm plan, the final year targets for the midterm plan is going to be delayed by a couple of years. So considering this current situation, we have actually reset the targets starting from March 2026. So we'll be able to have a restart of a new midterm plan to increase the corporate value. So the new midterm plan will be explained by our... in a business management vision and strategic story. That's all from me. Thank you for your attention. So next, we want to invite the President Aoi to explain the vision. Hello, this is Aoi speaking. Let me explain our management vision and strategic story 2031. Thank you for your attention. So towards 2031, which marks our 100th anniversary since the founding of Murray Group, we have set out the management vision and strategic story. We will explain our business strategies and impact goals for retail and fintech at our IR day on June 6th. Here's the digest, the summary. By shifting our business to support what we ski, which is individual interest, we'll realize a vision of overcoming the dichotomy between impact and profit and achieve high growth and high returns. So trying to get to 10 trillion yen, which is double the current level of transaction volume, we aim to accomplish high growth of over 12% per annum. And we also set high return of TSRs 12% or higher as a target, so we can actually increase our corporate value with a price to book of three to four times. So let me go over these agenda items one by one today. First of all, the basically economy driven by Suki, the individual interests. Under deflationary economy, the consumers have increasingly been inclined to make cost-effective purchases to protect their livelihood. At the same time, companies have also been aggressively competing on costs to get a share of the limited market. Meanwhile, issues such as environment, various social issues, and people's happiness have been left outside of the scope of the economy. So this situation has created a sense of stagnation in society, exhausted workers, and made young people feel anxious about the future. However, at this situation, is approaching a turning point as signs of escaping deflation are beginning to appear. However, to utilize the escape from deflation as an opportunity, we need a new economic vision that is not simply an extension of what we have done so far. So we decided to picture new economic possibilities. That is an economy driven by suki, the individual interests. In a deflationary economy, consumers were only concerned with cost effectiveness, but in an economy driven by Suki, the individual interest, people enjoy balanced consumption, spending money boldly on things they like. Companies also grow by creating new markets instead of competing for a limited market and competing on costs. In addition, people who are exhausted because they felt no meaning in their work are finding joy in their work, and young people who are anxious about their future are feeling hope. By transitioning to this new economy, we aim to be a business that goes beyond the dichotomy between impact and profit and achieve high growth and high returns. Based on this, this is a business that supports individual interests. Suki. Up until now, we have aimed to be a business that combines retail, fintech, and co-creation investments. Going forward, we'll shift to a business that supports your interests through events, goods, services, co-creation events, business development, and people, organization, and work styles with fintech at the core.

This is the scope of the business that supports individual interest. You may... Imagine that the individual interest refers to entertainment. However, our definition includes pet, sports, and other likes or interests for individual person. And also, we are to add Japan as the target of interest, such as Japanese food culture from foreigners. And the size of the market will be 60 trillion yen. Next is impact and strategy. I would like to cover these six items. First, through individual interest, the consumption will expand for society. The purpose of the business that supports interest is that through interest, the consumption will be for myself to someone else and to the society. And the impact can exist in both places. and the bridge is the card, and especially we will increase the card with donation function. We already have Herald Boni card where you can donate to the artists with disabilities, or pet card to donate to animal organization, or Yamap card for mountain climbers, or the utility electricity card for renewable energies. or others. The membership number is expanding. From March, museum cards started, and they are passionate fans, and the number of members are increasing. Under deflationary economy, consumers have focused on value for money. and corporates have tried to attract customers through reward points. And to the contrary, this scheme, the card that supports interest, is supported by the consumers who feel happy by donating and doing something for someone else. We want to pursue differentiating strategy. In future, we want to expand the membership of the card to support interest. 3 million is the target for the year March 31st, and in March 41st, the membership will likely to surpass gold card. Next is financial empowerment to support interest. Marui Group has supported the self-realization of the younger generation through trust co-creation. Next, we will focus on interest, the scope. or the target are people who are irregular workers and whose income is variable. We have been issuing credit cards, but that was only in the area where Marui has stores. And self-employed freelancers and startups and foreigners living in Japan They are having difficulty in receiving credit, and through financial empowerment, we are to support their work possibilities and also life through interest. In the regions where Marui does not have stores, we will solicit members through event goods and card, and we will create new units. Epos Card has a 16% market share in three prefectures where Marui has stores. And in other prefectures, our share is 5%. If we can increase the share in non-store existing prefectures, our potential will be 9 million, which is higher than current membership of 7.9 million. Through owner card, we expect additional 10,000 members by March 31st, and through collaboration with non-SUS, additional 20,000, and through GTN collaboration, additional 90,000 members. Next is the strategy to support realization of After the fixed-term lease has been introduced, we have been soliciting our card members through our own private brand. However, through withdrawal of the private brands, our contact point with the customers were lost. Therefore, we decided to develop a self-operating unit through card that supports the interest. To be more specific, the operational format is an integrated format of something like Yurakucho Marui 8th floor, event, goods, card center, all combined together. The feature of the new unit is the high capability to solicit new customers. The private brand is a The ability to gather customers is 16 times. So we intend to attract customers from abroad areas also to reach customers who never came to Marui stores and goods sales has high customer basket size and it is in a similar level as a private brand and we can further increase the unit price by developing our own merchandising and raise the gross margin. New unit is very small, 40 tsubo, and it is compact, so it can be operated in the upper floor, such as eighth floor of Yurakucho Maruhi. And also the rent It's lower in upper floor, and this has high capability to attract consumers and offer rare value. Another support strategy is digital transformation. Until now, we were aiming at enhancing the experience of the customers through digital means and established joint venture with a good patch and started recruited experts and develop on agile manner. In the future, through Marui United, we will do agile development in-house. Chief Digital Transformation Officer Good Patch and CEO Tsuchiya-san contributed in promoting professional organization of human resources to participate, such as CTO. Going forward, through digital UX and new unit, we are to fuse the digital and real experience to develop loyal customers.

The next is unleashing creativity through flow. We have focused on the concept of flow, which comprehensively captures the important business elements of ability, challenge, creativity, and happiness, and have been working to increase the job satisfaction of each employee and the vitality of the organization. Furthermore, analysis of the flow data revealed that the flow rate of employees who apply their interest to their work was remarkably high at 78%. Therefore, going forward, we will increase opportunities to utilize our interests in our work through competitions that support those interests, and by demonstrating their creativity, we will expand further business by utilizing intangible assets such as ideas, knowledge, and know-how. We'll also aim to further increase our corporate value by increasing the intangible asset ratio to over 70%. This is business development through social entrepreneurship. There are two types of people who create innovation, entrepreneurs and intrapreneurs. Up until now, we have aimed to create innovation through co-investment with external entrepreneurs. But going forward, in addition to this, we'll also work to create businesses through in-house entrepreneurs. To this end, we advocate a working style known as social intrapreneurship, where you can change society without leaving your company. And by disseminating this information widely, we hope to attract and encourage talented people from all over the world to thrive. Specifically, we'll set up a business production promotion office and advance business development by recruiting social intrapreneurs from both inside and outside a company through various employment arrangements. We also plan to establish a social intrapreneur development foundation with the aim of developing human resources in the medium to long term. We'll develop human resources by offering courses to university students, junior and senior high school students, and in the future, we'll utilize the graduates to develop our business furthermore. This is an area of exploration. In the exploration, we'll work on globalizing businesses that support individual interests. Based on the theme of Japan as an object of interest from the world's perspective, we'll advance business development by recruiting talented people from all over the world who love Japan. A summary of business strategies. Fintech. We aim to attract 3 million new members and expand transaction volume by 4 trillion yen through 1, 2, and 3. In retail, we aim to increase revenue by 10 billion yen through number 3. In future investment, we aim to contribute more than 7 billion yen through 4, 5, and 6. Next is risk. I'd like to explain the risk of rising interest rates. We expect financial expenses for the fiscal year ending March 2031 to increase by around 10 billion yen just due to rising interest rates. To address this, we'll implement two measures. First, we'll be changing the installment and revolving fees. We will be informing our customers about this in the future, so the implementation date is still to be determined, but we plan to implement by the end of this fiscal year. As a result, we expect an increase in revenue of roughly 12 billion yen in the final year. Regarding the procurement funding cost, we want to reduce interest rate by approximately 0.1% by shortening the average maturity from seven to four years, and by strengthening dialogue with rating agencies, improving our ratings by one or two notches, aiming to improve interest rate by 0.1% to 0.2%, or a combined improvement of approximately 3 billion yen on an aggregated basis. Capital policy and shareholder returns. This is the balance sheet that we should aim for. When we break down the balance sheet for fiscal year ending March 31st by segment, the equity ratio for retail is expected to deviate from the target of 35% to 50%. Therefore, we'll optimize our capital opposition by conducting share buybacks worth 30 billion yen. After implementing capital optimization, we aim to achieve a consolidated capital ratio of 16%. The shareholder return policy, our return equity exceeded 10% this fiscal year, and we are aiming for 15% towards 2031. We will raise DOE from 8% to 10% starting this fiscal year. Capital allocation. We expect core operating cash flow over six years to be around 350 billion yen. Gross investment will be 90 billion yen in existing businesses. Future investment will include 60 billion yen in digital transformation investment and business development. Also, allocating 30 billion yen to share-buy bags to optimize capital and shareholder returns will include 150 billion yen in dividends and 20 billion for flexible share-buy bags for a total of 170 billion yen. These next KPIs. Price to book is three to four times. To accomplish this, we aim for a return equity of 15% and PER of 25 or more. We aim to achieve an RE of 15% or more by improving our profit margins, total asset turnover, and financial leverage across the entire company, including retail and fintech. We also aim to achieve a PER of 25x or more by achieving high growth in transaction volume of 12% or more and reducing beta through an increase in individual shareholders. Based on the above, we aim for high growth and high returns with EPS growth rate of 9% or higher and TSR growth rate of 12% or more. That's all from me. Thank you very much for your attention.

We would like to move on to Q&A session. The first person is Takahashi-san from Mizuho Securities. I'm Takahashi from Mizuho Securities. Thank you for the presentation. I have two questions. My first question is directed to Kato-san, and the second question is to the President Aoki-san. So let me state those questions. First question to Kato-san. The Financial strategy in MTP and ROE target 15%. The relationship between the two, six months ago, there were rough plans being presented, and at that time, ROE target was 17% to 20%. This time, you're seeing 15%. It is still high, but what is the background of this change? You may be looking at external environment and interest rate hikes. As a CFO, if you could explain about that. My second question is to Mr. Aoki this time. Looking at the press release, when it says three business integrated and fintech, I got an impression that you're going to become quite a general credit card company. But listening to the presentation, I understand that that is not the case, and I'm relieved. Before the current MDP started, the initiatives were implemented, and now those are bearing fruits. You talked about large stores being binding, and now you're talking about new events, fintech and goods, and I think you're more agile in developing your business across Japan. Employees that support it and the relationship with the commercial facilities, I think you have been nurturing them until now, and Out of various possibilities, what is the strategic or competitive advantage of this strategy? I cannot imagine about your peers, but how confident are you on the competitive advantage? If you could talk a little bit more about that. This is Kato speaking. I will answer your first question. As you mentioned in November last year, we said 17% to 20% of ROE will be our target. But after that, we have scrutinized and reviewed And interest rate rising, rising of the interest rate, the speed assumption is faster, speed now is faster than our assumption. And it's possible that it will rise further. So look, with that assumption this time, we're saying 15% or higher. we're saying higher than 15%. So it's not that we have given up the target of 17%. We will continue to target but for now, we set our guide guidance at 15%. Thank you. Thank you for your question. As you have asked in your question, we have retail credit card and three business integration, and then we're going to transfer our business in a major way to support individual interests. What is our competitive advantage? That is the essence of your question. As you have correctly pointed out, the biggest Differentiator, competitive edge is our people and the know-how that our human capital has. For example, event planning and operation, our company's employees. are very good at event planning and organization. This may be a personal view, but compared to private brand or merchandising, I feel that our staff is better at event planning and organization. In addition, product manufacturing, planning, production to sales, we have been developing our expertise in that area. Together with event, we will sell merchandises. We can do both. On top of that, we have memberships of credit cards. We solicit members. So through a series of events, initiatives, we can solicit members. So event planning, selling of merchandises, and recruiting members. Those three will be integrated. And same staff will face consumers in these three areas. And having such a know-how is the biggest differentiator of our company. Another point is our stores and regarding nationwide deployment of stores. Large stores, minimum 3,000 Tsubo stores would be the guide. Kita Senju is bigger than 10,000 Tsubo stores. Well, our conventional stores have been big and asset heavy, but new unit is very different, very light. And as was explained just now, in the upper floors of the commercial facilities, the traffic can be generated by ourselves. So the content is such that people will come to small space and compared to ground floors or lower floors, the rent is economical. And on top of that, we can gather consumers by ourselves, market ourselves. So from the developer and commercial facilities perspective, They favor us. So that is our position. And the possibility to open new stores will increase dramatically. So in regions where we couldn't open stores, for example, in Nagoya or Hiroshima or Sendai, in those areas, We can open new stores in a flexible manner since it's compact size stores. And the efficiency of gathering members is 30 times. So the floor area is compact, small, at low cost. Maximum impact can be achieved. So we would like to bring this to success. Once we can expand this nationwide, then existing stores' efficiency can be improved, and it makes it easier to improve efficiency. So new unit nationwide deployment and existing store efficiency improvement, we can pursue both and contribute to each other, and we want to realize that format. Thank you.

Thank you so much. Next question. Kanamori-san from Okasan Securities. This is Kanamori from Okasan. Can you hear me okay? Yes, we can hear you. I have a couple of questions as well. Mainly for Kato-san. And a bit too specific question. So FinTech Results. So the final number of final charges on installment and revolving payments and the related assumptions and the affiliate commission rates results and your original forecast. Seems like there are some gaps in those numbers. So the final charges on installment and revolving payments the growth that you expected to be the 7.7%, seems like you ended up almost in line with this. But when it comes to growth of affiliate commission rates, originally you expected about 12% growth or so. The result slightly fell short. According to your explanation, Since we saw the lower commission rate, it's been stable. I think that's what you said. So this lower commission rate, did it affect the result to some level? What was the reason for this gap? I know it's the year already ended, but can you elaborate on this point? Understood? The transaction volume was not accomplished in the target. That was due to overseas consumption usage. The travel and entertainment was slightly short. From the revised plan, the overseas usage showed a gap. The overseas usage, a relatively higher commission rate is charged. So the rate-wise, it came out to be slightly lower because of not being utilized much. So that affected the results from what we shared back in Q3, and we saw a weaker result for the commission rates compared to this number. Okay, based on that, for March 26, this year's assumption. So the balance for finance charges and installment and revolving payments, you expect to see 6% growth. then you expect to see a much stronger growth of these financial charges, 8.6%. Earlier, I think President Aoi also mentioned in March 26th sometime during this period, you're talking about raising the rates, right, of charges, financial charges. On page 32, you have water flow chart, so OP break changes. I think that was explained by Kato-san earlier. So the interest rate hike portion. So there's an increase of financial expenses. I think you mentioned that. But at the same time, at some point during the year, you're going to raise that rate and that raises your revenue. Is it included in the plan at this point in your forecast right now? I see. Thank you. As President Aoi mentioned, during this year, we plan to raise the rate, the charges, but we haven't announced yet. So we're still deciding when to start. So in this plan, we're just including the minimum number. So only one quarter worth, only three months worth is included, worth 1.5 billion yen. It's already included in our financial charges on installment payments. So depending on timing, this number could have either in a positive or negative. Yeah, if we could start earlier than that, earlier than planned, then we can see an upside. Yes, thank you. Thank you.

Next question, Daiwa Securities, Shigeoka-san, please. I'm Shigeoka from Daiwa Securities. Thank you for the presentation. In the new medium-term plan, you have new initiatives, and those were interesting. I have two questions. First question. Marui's, well, regions where you don't have Marui's stores through new operating unit, what is the potential of acquiring members? And you have usual card and also interest support card. You have physical stores and online events. What is the channel where you acquire new members? Do you have a ratio that you can share? The card that supports interest, if you can compare it with the conventional usual card, I'm mostly interested in the card that supports interest. Total card is 800,000 and 300,000 is coming from physical stores. The remainder, 200,000 people. is through services such as rent guarantee, and $300,000 is from online channel. The card that supports interest is Other than service, we do issue cards that support interest. So 60% out of the total cards are supporting cards. So just for supporting cards, interest supporting cards, is it mostly events and online? The ratio of event and online hire? Yes, that is right. The issuance at stores basically are actually issued through events. So issuance through events make up most of the issuance. So event is the core. So related to events, customers became aware of the existence of the card, and event is a good opportunity to become a member. regions where you don't have stores, by creating such events and opportunities, you can reach customers that you cannot reach currently. Right. Actually, when we do events at stores, then that information is spread through social media. So there is a compound effect. And by deploying this scheme nationwide, we can acquire a large So in addition to holding events, are you going to strengthen the digital media? Online channel will be a very important entry point. It depends on how you use it. As you say, by event information spreading, people who love those contents will find that information through social media and then sign up through online channel. And we would like to also focus on that as well. Thank you. My second question. The installment and revolving commission increase Page 87 of the slide, I think you have that information. 12 billion in operating revenue. That is a guide that is shown here. If it contributes in full scale in FI26, this is the amount of contribution. Is that the timeframe? Within FY25, the timing is still under consideration. And I understand that the scale is also under consideration. So this is the image, the upper part, the operating revenue. This is the image for 2026. $12 billion is for the fiscal year ending March 2031. I think it can reach 10 billion. The balance or denominator, it will depend on the denominator. So by 2030, it will be this large. But from the beginning of the raise of the commission, the impact will be large. If we are to implement a commission increase, it will implement instantly across the board. And from that time, this scale of increase of revenue can be expected. And also the suppression of the funding rate, I think that will depend on the timing of refunding. So is the guide at 2030 expected? Or do you expect impact in next 2 to 3 years? What is the time frame? 10 billion yen increase of financing cost. This is about year 2030. At that time, If these measures are working well, then we expect $3 billion. So this picture is assuming this will be realized in the year 2030. And gradually, you're going to shorten the tenure for the funding and proceed with the initiatives. That is correct. Thank you.

Next question from SMBC NICO Securities, Kanamori-san. This is Kanamori from NICO Securities, and I have a couple of questions as well. I want to also ask about the financial charges. So you talked about 1.5 billion yen for one quarter is factored in. So is this only for the new receivable? Would that be, I guess that is how you calculate it, right? So you switch the charges only for new receivable. No, for the revolving payments, the whole amount is going to be switched to the new rate. For the installment payments, it's going to be starting from new receivables. I see. So revolving and installment payments should be separated maybe in asking you this question. So your installment evolving payments balance, what is the remaining years for those receivables for the installment payments within one year? Seven or eight months. On the revolving payments, roughly five years. I see. Thank you. Another question. About half a year ago, you mentioned the midterm plan as the core. Talking about the closures of the retail stores to focus on the key stores, I think, that's not mentioned in this presentation. For the new year, looking at the retail business plan, seems like you're not including the store closures So it's just not happening this fiscal year, or what is your view and idea, and what's the schedule of store closures? Maybe I should wait for the IR day, but I would appreciate if you can share any information. At the IR day, we will have more details on this point, but we are reorganizing ourselves right now. There's a CRE... Strategy Promotion Office, which we started this April. CREO, the Nakamura-san, Senior Managing Director, is leading this team. So they are working on a strategy on this point. So the store assets as well. the low profitable businesses, the stores and stores that doesn't really generate new cardholders will take actions. But it involves many stakeholders, so it's very difficult to give specifics. But we decided to shut down, close down one store. The Kashi Yama Marui is going to be closed, and then we will be closing another ones to come. So the valley up, the CRE Estuary Office is working on that. on this. And so we will reinforce events by focusing on the key branches. And so we'll work on that along with the investments. So I think we're making good progress on this point. Thank you. So Kashiwa store, it depends on when it's going to be shut down once Kashiwa is closed. So some Rather than focusing on increasing the values on certain sections, by closing down, the whole store could cause much bigger negative impact, maybe not having much impact on the net level. Is that the right understanding? So underperforming branch or store is going to be closed, so it doesn't affect the bottom line. The top line, in case of Kashiwa, it's not such a large surface area, so no major impact, significant impact on the revenue. I see. Thank you so much.

Are there any more questions? Please press raise hand button on the screen if you have any questions. There are no more questions. So with this, we would like to close the Q&A session. Now we would like to close the financial briefing session for fiscal year ending March 2025.